Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry
The toy industry faces relentless change and an unpredictable buying public, which creates immense challenges in anticipating best sellers and predicting volume. Like the high-technology industry, toys also suffer from many supply chain ailments, including short product life, rapid product turnover, and seasonal demand. Coupled with long supply lines and ongoing political and economic turmoil in Asia, toy makers face an unusually complex set of risks. Managers in many businesses can learn valuable lessons in managing uncertainty from toy makers. This article describes supply chain lessons focused on reducing risk by actively managing both demand and supply variability. These lessons include product variety strategies based on product extensions, rolling mix strategies, leveraged licensing agreements, coordinated outsourcing strategies, and hedging against political and currency risk by producing in many different countries.
Swot Analysis of "Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry" written by M. Eric Johnson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Toy Lessons facing as an external strategic factors. Some of the topics covered in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry case study are - Strategic Management Strategies, Marketing, Risk management and Technology & Operations.
Some of the macro environment factors that can be used to understand the Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry casestudy better are - – supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, increasing energy prices, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy,
technology disruption, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Toy Lessons, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Toy Lessons operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry can be done for the following purposes –
1. Strategic planning using facts provided in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry case study
2. Improving business portfolio management of Toy Lessons
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Toy Lessons
Strengths Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Toy Lessons in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry Harvard Business Review case study are -
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Toy Lessons digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Toy Lessons has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Toy Lessons is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Toy Lessons is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Toy Lessons has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Strong track record of project management
– Toy Lessons is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Toy Lessons is one of the leading recruiters in the industry. Managers in the Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Technology & Operations field
– Toy Lessons is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Toy Lessons in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Toy Lessons has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Toy Lessons has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Cross disciplinary teams
– Horizontal connected teams at the Toy Lessons are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Operational resilience
– The operational resilience strategy in the Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Toy Lessons in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Toy Lessons has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Toy Lessons has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry are -
Slow to strategic competitive environment developments
– As Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry HBR case study mentions - Toy Lessons takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Need for greater diversity
– Toy Lessons has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Lack of clear differentiation of Toy Lessons products
– To increase the profitability and margins on the products, Toy Lessons needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Toy Lessons 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry can leverage the sales team experience to cultivate customer relationships as Toy Lessons is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Toy Lessons has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Toy Lessons even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry, in the dynamic environment Toy Lessons has struggled to respond to the nimble upstart competition. Toy Lessons has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry, is just above the industry average. Toy Lessons needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Toy Lessons has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry, it seems that the employees of Toy Lessons don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Toy Lessons supply chain. Even after few cautionary changes mentioned in the HBR case study - Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Toy Lessons vulnerable to further global disruptions in South East Asia.
Opportunities Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry are -
Developing new processes and practices
– Toy Lessons can develop new processes and procedures in Technology & Operations industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Buying journey improvements
– Toy Lessons can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Toy Lessons to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Leveraging digital technologies
– Toy Lessons can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Toy Lessons can use these opportunities to build new business models that can help the communities that Toy Lessons operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Toy Lessons can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Toy Lessons can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Toy Lessons has opened avenues for new revenue streams for the organization in the industry. This can help Toy Lessons to build a more holistic ecosystem as suggested in the Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry case study. Toy Lessons can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Toy Lessons in the consumer business. Now Toy Lessons can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Toy Lessons has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Toy Lessons can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Toy Lessons has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Toy Lessons to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Toy Lessons in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Threats Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry are -
Shortening product life cycle
– it is one of the major threat that Toy Lessons is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Toy Lessons with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Toy Lessons.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Toy Lessons needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Toy Lessons in the Technology & Operations industry. The Technology & Operations industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High dependence on third party suppliers
– Toy Lessons high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Environmental challenges
– Toy Lessons needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Toy Lessons can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Toy Lessons can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Toy Lessons in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Toy Lessons has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Toy Lessons needs to keep up with the evolution of technology in the Technology & Operations sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Toy Lessons will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Learning From Toys: Lessons in Managing Supply Chain Risk From the Toy Industry is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Toy Lessons needs to make to build a sustainable competitive advantage.
